Narrow Web Profile: The Label Printers

Quality, customer service and added value are important aspects of how The Label Printers does business.

Michelle Sartor07.17.06

The Label Printers' Webtron 750

The name doesn't tell the whole story. Yes, The Label Printers prints labels for a variety of industries including medical products, pet care, automotive, and consumer goods. But the company is also dedicated to quality, customer service and adding value for customers, which it believes can be more important than competing on price alone.

The Label Printers was founded in 1967 in downtown Chicago before moving to its current location in Aurora, IL, USA in 1974. By 1989, it had doubled in size. The company received ISO certification in 1995 and built its second plant in Aurora in 1996 next door to its first facility. It acquired Graphic Label in Sugar Grove, IL, USA in 1997. It also acquired Lancaster Press in Melrose Park, IL, USA in 2002.

The acquisitions allowed The Label Printers to branch out in terms of type of work. At first, the company primarily served the industrial end of the market. After the acquisitions, point of purchase and package design elements became more important. Currently, the company's biggest markets are medical products, pet care, consumer goods, and automotive.

The Label Printers currently has 80 employees working two shifts at its two Aurora plants, which total 94,000 square feet. The company had $24 million in sales in 2005. It is privately owned. Bill Kane, chief executive, and Lori Campbell, general manager, are the managers most involved in daily activities.

The Label Printers' biggest customers have been with the company for more than 15 years. To maintain the highest level of customer service, employees try to be flexible. She says, "We customize not just the label, but the services around labels. We figure out a way with any request to give the customer what they want within reason." For example, The Label Printers will do both short and long runs so it doesn't force customers to look elsewhere for their label needs.

The Label Printers has more than 20 presses at its two Aurora facilities,
including this 16" Mark Andy 4150.

One of the main goals of The Label Printers, of course, is adding value to the process. Campbell explains that this is becoming more difficult. "What was value added yesterday is value expected today. You have to find what the customer sees as valuable," she says. Cheaper, faster, better are trends in almost all industries, according to Campbell, which makes it harder to find value.

Adding value is more of a focus of The Label Printers than competing on price alone. The company currently has no online quotes or ordering options. Campbell says, "We don't want to be a price competitor. A lot of times that's what happens with web site quotes. With web sites, there are no business development conversations, just application specs." The company is currently in the development stage of its online form. Campbell says they are trying to figure out how to include information to determine customers' long-term needs and what additional benefits The Label Printers can incorporate if its price isn't the lowest.

The company inventories quite a bit for customers. Having two plants next to each other offers an inventory advantage. The company stores inventory in both facilities so that if something happens to one of the plants, the customer won't lose everything. Campbell explains another advantage of having both: "The two facilities are separate, both with full generator backups. If one blows up, we're still operational in all capabilities to a lesser degree."

Quality is another important area for The Label Printers. In addition to ISO certification, the company has personnel trained in Six Sigma, which offers approaches to process improvements. Campbell says Six Sigma is one area the company hopes to draw on for added value. They won't use it unless it has benefits for customers, however. Campbell believes ISO and Six Sigma are complementary. She says, "We've had a 99.6 percent product acceptance rating since 1989, and we've gotten quality awards from customers. We're pretty pleased with that."

The Label Printers' Webtron 1000

Equipment and capabilities

The Label Printers uses hot stamping, flexo, rotary letterpress, and digital printing processes. The company has more than 20 presses, from such manufacturers as Mark Andy, Webtron, Aquaflex, HP, and Ko-Pack (rotary letterpress). The Label Printers makes its own plates using a traditional solvent wash system. Although the company evaluated computer-to-plate technology, Campbell says that they chose not to go in that direction at the time because the benefit to customers wasn't demonstrated. She believes that at some point it will make sense to change to computer-to-plate technology because much of the industry is going digital.

The company purchased an Indigo ws4050 digital press from Hewlett-Packard in late 2005. Feedback has been positive. Campbell says, "We love the Indigo. It has beautiful print quality. Makeready and waste is unheard of. Changeover between jobs is unbelievable. It's a great addition." Early production on the digital press involved a lot of trial and error and sample work. Now, output is steadier. Campbell says digital printing is used most often in the food and beverage, health and beauty, wine, and pharmaceutical industries. According to Campbell, anything with variable image and process work can be printed well digitally.

The digital press acquisition was big for The Label Printers, so it has no immediate plans for another press purchase. Campbell points out, however, that the company is always looking to reinvest in the organization. "We're not afraid to spend the money when we need to. We also don't throw money around," she says.

The Label Printers always visits Labelexpo, sending all department managers and key operations people. Campbell says the goal this year is to attend more seminars to learn more about what's happening in the industry.

Labels as a commodity

Campbell believes that demands in the marketplace have increased. She says quality is important and expected, on-time delivery is expected no matter what, and customers expect converters to provide all things at the best price. Although she says the idea that loyalty no longer exists is not necessarily true, she admits that it doesn't come easy.

The Label Printers acquired this HP Indigo ws4050 near the end of 2005

Then there's online bidding. Campbell says, "We're close to refusing to do online bids. It reinforces labels as a commodity and we don't think it is."

One problem Campbell cites about labels being treated as a commodity is that with low margins, it's difficult to compete. She says, "If printers are playing the price game for too long, they will get squeezed because bigger companies realize it doesn't help them if the company goes under."

The Label Printers is currently in the middle of strategic planning to help answer some of its questions. Campbell says, "The biggest thing is for us is to develop a lot more knowledge of our customers and their customers. We're on a big push to know specifically what our customer wants, which can get lost in the day-to-day."

Campbell expects growth for The Label Printers over the next three to five years. She says the growth is in line with the industry average of 3 to 5 percent, but that the company would like its growth to be a little higher. "We want controlled growth. Not just an increase in sales, but more profitable sales and improving margins," she says.

Campbell believes that consolidation in the industry will continue because when margins are so slim, companies can't invest and continue to improve. She predicts, therefore, a decrease in the number of label companies. The Label Printers might try to take advantage of that environment. "We always have our ear to the ground for acquisitions, but it has to be a good fit," Campbell says. She adds, "Expanding into other marketplaces is a possibility."

Partnerships and alliances are parts of the industry that Campbell believes have grown and will continue to strengthen in the future. She says, "Nothing's a secret any more. You have to work together for the sake of the industry." She believes the industry is going through a transition, describing it as a bell curve. Before, there was strong, profitable business growth, but now that is not always the case. Campbell believes the industry is over the cusp of the curve. "It didn't used to be this difficult. It's a rude awakening for long-term companies," she says.

Because small shops often have the same capabilities as larger businesses, providing customers with specific advantages on the production side becomes much more difficult. Campbell says that right now The Label Printers may have an advantage with its HP Indigo digital press since only a limited number exist in the industry, but that advantage is short-lived. She explains, "You can't sit back. We all keep looking for competitive advantages."